Selling mutual fund shares at Vanguard question

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I have some shares of a bond mutual fund at Vanguard that pays dividend at the end of each month. If I sell all shares in the middle of the month and bring the balance to zero would I lose the dividend that could post at the end of the month or because of the NAV it does not make a difference? Also, if all the shares are sold would they automatically close this account? 

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The NAV adjusts based on anticipated dividend; so it should not matter.

traderranger said:   I have some shares of a bond mutual fund at Vanguard that pays dividend at the end of each month. If I sell all shares in the middle of the month and bring the balance to zero would I lose the dividend that could post at the end of the month or because of the NAV it does not make a difference? Also, if all the shares are sold would they automatically close this account? 
  
No reason to wait for dividend to sell - if you've already decided to sell.   The fund price/NAV will adjust after dividend (i.e. will go down after dividend).   

I don't think they'll close the account .. and you don't want the account to be closed.  You will need access to the account for tax information next year.  But check if they have any minimum for account though - if you drop to $0, i'm not sure if they charge any fee or not.

If you don't need the money right away, you can also sell the mutual fund, and put it in some money market type fund - those are not FDIC insured, but they never ever go below original value



 

The other answers are generally correct, but Vanguard does it differently. If you sell your shares before the end of the month, they issue a partial dividend at the end of the month for the days that you held the fund. It doesn't make much difference, but doing it this way means that the NAV doesn't jump down after the dividend.

Vanguard does not immediately close your account even if it is $0. Maybe a couple of years of no activity might close it.



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